Waters Lauds CFPB Arbitration Proposal to Protect Consumers

WASHINGTON, D.C. - Today, Congresswoman Maxine Waters, Ranking Member of the House Financial Services Committee, issued the following statement applauding the Consumer Financial Protection Bureau’s (CFPB) proposed rule on forced arbitration:

“Everyday contracts, such as credit card agreements and checking accounts, should not use fine print to automatically deny consumers the right to access the civil justice system when they have been harmed by financial corporations. Today, the Consumer Financial Protection Bureau is proposing to put an end to these potential abuses by using its authority under the Dodd-Frank financial reform law.

I fully support the CFPB’s efforts and its work in this area. No consumer should ever be forced to sign away their legal rights just because they want to open a bank account, get a credit card, finance a car, or obtain a private student loan so they can pursue their education. I believe that the CFPB’s proposed rule is the first step to reforming this problematic practice. As a result of the Bureau's efforts, we will better protect American consumers and bring about much-needed accountability in our financial system.”

The CFPB’s proposed rule is the culmination of a three-year long study and analysis, as well as a 700-plus page report on the landscape of consumer arbitrations. Specifically, the CFPB’s study analyzed over 1,800 consumer finance arbitration disputes, 3,400 individual federal court lawsuits, 42,000 credit card cases in small claims court, and conducted a telephone survey of over 1,000 consumers concerning their knowledge and understanding of arbitration and dispute mechanisms. Congresswoman Waters has been a consistent advocate for Dodd-Frank and financial reform, especially regarding forced arbitration, and continuously supports the CFPB’s longstanding efforts to provide additional consumer protection to American taxpayers.

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